Mboweni challenged over Reserve Bank comments

Former Reserve Bank Governer Tito Mboweni allegedly said to Michael Oatley that “the process has moved on to such an extent that we want to close this matter.”Photo: Masi Losi

Former Ciex chairperson Michael Oatley yesterday hit back at former South African Reserve Bank governor Tito Mboweni over his comments last week that a special team of experts, which was previously hired to probe the Bankorp bailout, had not found it necessary to pursue the matter further.

Oatley said the team appointment by Mboweni to investigate the matter had also arrived at the conclusion that the transaction between Bankorp, Absa and the Reserve Bank was illegal.

OWN PANEL

“After an interval further public concern prompted Mr Mboweni, by now governor of the SARB, to appoint his own panel of experts under Mr Justice Davis to review the matter and, so he evidently hoped, to put it finally to bed. They did their best to do so, but with apparent reluctance joined by their predecessors in concluding that what had been done was improper and, in fact, illegal,” Oatley said.

Public Protector Busisiwe Mkhwebane last week faced criticism from a number of quarters after she stated that the government and the SA Reserve Bank had failed to protect the public by bailing out Bancorp between 1985 and 1991.

Mkhwebane said the primary mandate of the Reserve Bank, therefore, had to be amended. She further said that the Reverse Bank had unwisely failed to recover more than R1billion from Bankorp/Absa Bank, which was part of billions, advanced as an “illegal gift” to the Bankorp group and ordered the Special Investigative Unit to recoup the money on behalf of the government.

Mboweni quickly launched a spirited defence on the independence of the Reserve Bank on his facebook timeline last week, and argued they had rejected Oatley’s offer to recoup the “bailout” money from Absa for a fee.

“Somewhere in 1998, a British bounty hunter came to us to say that there was a debt that the ‘boers’ had to repay the new South Africa. Hallelujah! He produced to us documents that showed that Absa was liable to pay back about R1.5bn with interest over the years. He in return would receive 10percent as a fee for helping us retrieve these ‘stolen’ monies,” Mboweni said.

Upon assuming the office of governor of the Reserve Bank, he had instituted an independent investigation headed by a judge, backed by a multidisciplinary team and the report they had furnished was submitted to the Public Protector. “On the basis of that report, and its recommendations, the matter was concluded. Yes, I must admit, that a different panel might have come to a different conclusion as these matters normally are the case.

UNFAIR

“But to cast negative judgment on their genuine professional work is both ingenious and unfair. It might be impugning on their professional standing in their professions, society and capabilities,” Mboweni said. Mboweni served as head of the central bank from 1999 to 2009.

Oatley said Mboweni’s version of events did not reflect reality. He had written a letter to him on the findings of the investigations he had commissioned and alerted him that they also found the bailout to have been illegal.

“In his reply to me dated April 15, 2002, Mboweni did not dispute that the opportunity for recovery existed, as indeed it still does along with other opportunities for restitution, but thanked me and said that “the process has moved on to such an extent that we want to close this matter.”